UFM Industries Ltd. (UFMINDS) - Director Report

Company director report

Your Directors have the pleasure in presenting before you the 30th Annual Report andAudited Accounts of the Company for the year ended on 31st March 2016.

1. FINANCIAL RESULTS

The operating results of the Company for the year under review are as follows:-

Rs. In lacs

Rs. in lacs

31-03-2016

31-03-2015

Incomes

3964.99

3753.93

Exceptional & Extraordinery item

-

-

Expenses

3877.91

3654.80

Operating Profit

87.08

99.13

Interest

19.16

25.97

Depreciation

23.95

39.92

Profit before tax

43.97

33.24

Less: Taxation

Current

13.43

9.98

Tax of Earlier year

-

-

Deferred

(0.88)

1.45

Profit after tax

31.42

21.81

2. OPERATIONS

The total Income for the year was Rs. 3964.99 lacs as compared to the income for theprevious year of Rs. 3753.93 lacs. The Company has recorded a profit of Rs.31.42 lacsduring the year under review. To enable the company to augment and conserve money for longterm working capital requirement the Board of Directors do not recommend dividend thisyear.

3. AUDITORS

M/S Anil Hitesh and Associates (ICAI Firm Registration No. 325406E) CharteredAccountants Statutory Auditors the retiring auditors during the Annual General Meetingheld on 30.09.2014 were appointed from the conclusion of 28th Annual GeneralMeeting until the conclusion of 31st Annual General Meeting subject toratification by members at every Annual General Meeting in terms of Section 139 of theCompanies Act 2013. The Auditors have furnished a certificate stating that theirappointment if made will be within the limit laid down under section 139 of theCompanies Act 2013 and that they are not disqualified for reappointment within themeaning of section 141 of the said Act. The Board of Directors therefore recommendsratification of appointment for F.Y. 2016-17 of M/S Anil Hitesh and Associates (ICAIFirm Registration No. 325406E) Chartered Accountants as Statutory Auditors of theCompany for the approval of Shareholders.

The Notes on Accounts referred to in the Auditors Report are self explanatory and donot call for any further comments.

4. DIRECTORS AND KEY MANAGERIAL PERSONNEL

Ms. Tara Jain Non-Executive Director retire by rotation and being eligible offerherself for reappointment at the ensuing Annual General Meeting.

All the Independent Directors have given declarations that they meet the criteria ofindependence as laid down under Section 149(6) of the Companies Act 2013 and Clause 49 ofthe Listing Agreement entered with Stock Exchanges. In the opinion of the Board theyfulfil the conditions of independence as specified in the Act and the Rules made thereunder and are independent of the management.

The Nomination and Remuneration Committee has formulated the criteria for determiningqualifications positive attributes and independence of Directors in terms of provisionsof Section 178 (3) of the Act and SEBI (LODR) Regulations.

Independence: In accordance with the above criteria a Director will be considered asan Independent Director' if he/ she meets with the criteria for IndependentDirector' as laid down in the Act and SEBI (LODR) Regulations.

Qualifications: A transparent Board nomination process is in place that encouragesdiversity of thought experience knowledge perspective age and gender. It is alsoensured that the Board has an appropriate blend of functional and industry expertise.While recommending the appointment of a Director the Nomination and RemunerationCommittee considers the manner in which the function and domain expertise of theindividual will contribute to the overall skill-domain mix of the Board.

Positive Attributes: In addition to the duties as prescribed under the Act theDirectors on the Board of the Company are also expected to demonstrate high standards ofethical behaviour strong interpersonal and communication skills and soundness ofjudgement. Independent Directors are also expected to abide by the Code forIndependent Directors' as outlined in Schedule IV to the Act.

6. EVALUATION OF PERFORMANCE OF BOARD OF DIRECTORS

The Directors of your Company are in a fiduciary position empowered to oversee themanagement functions with a view to ensure its effectiveness and enhancement ofstakeholder's value.

The Board provides and critically evaluates strategic direction management policiesand their effectiveness on your Company. Their objective is also to ensure that the longterm interests of the shareholders are being served.

Independent Directors are appointed not merely to fulfil the statutory requirement butto provide strategic direction and guidance and provide constructive support to managementby asking the right questions and generating quality debates and discussions on majordecisions. The Board of Directors is at the core of your Company's corporate governancepractice and oversees how the management serves and protects the long term interests ofthe stakeholders. Your Directors believe that an active well informed and independentBoard is necessary to ensure the highest standards of corporate governance.

7. EXTRACT OF ANNUAL RETURN

Extract of Annual Return of the Company is annexed herewith as ANNEXURE "A"to this Report.

8. MEETINGS OF THE BOARD.

Eight meetings of the Board of Directors were held during the year. For furtherdetails please refer report on Corporate Governance forming part of the Annual Report.

9. RELATED PARTY TRANSACTIONS

All Related Party Transactions that were entered into during the financial year were onarm's length basis in the ordinary course of business and were in compliance with theapplicable provisions of the Companies Act 2013 and SEBI (LODR) Regulations.

Details of the transactions with Related Parties are provided in the accompanyingfinancial statements.

10..DEPOSIT :

The Company has not accepted any deposits during the year under review.

11 .PARTICULARS OF LOANS GIVEN GUARANTEES GIVEN AND INVESTMENTS MADE

The particulars of loans given investment made or guarantee given or security providedand the purpose For which the loan or guarantee or security is proposed to be utilised bythe recipient are provided in the financial statement.

12. DETAILS OF POLICY DEVELOPED AND IMPLEMENTED BY THE COMPANY ON ITS CORPORATE SOCIALRESPONSIBILITY INITIATIVES

The provisions of Corporate Social Responsibility is not applicable to the company.

13. MANAGEMENT DISCUSSION AND ANALYSIS

Management Discussion and Analysis Report for the year under review as stipulated underclause 49 of the listing agreement with the Stock Exchanges in India is presented in aseparate section forming part of the Annual Report.

14. SECRETARIAL AUDITOR

The Board has appointed Mr. Pravin Kr. Chhajer Practising Company Secretary toconduct Secretarial Audit for the financial year 2015-16. The Secretarial Audit Report forthe financial year ended 31st March 2016 is annexed herewith marked asANNEXURE B' to this Report. The Secretarial Audit Report does not contain anyqualification reservation or adverse remark.

The Board has appointed Mr. Manish Jain Manish Jain & Associates PractisingCompany Secretaries as Secretarial Auditor of the Company for the financial year 2016-17.

15. INTERNAL FINANCIAL CONTROLS

The Company has in place adequate internal financial controls with reference tofinancial statements.

16. PARTICULARS OF EMPLOYEES AND REMUNERATION

The ratio of remuneration of each director to the median of employees' remunerationrequired under section 197(12) of the Act read with Rule 5 of the Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014 is annexed as ANNEXURE C'.

In accordance with the requirement of Rule 5 (2) and (3) of the Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014 it is stated that no employee of theCompany was in receipt of remuneration aggregating to Rs.6000000/- or more per annum andRs.500000/- or more per month if employed for part of the year.

17. CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION

The details of conservation of energy and technology absorption are as follows:

(a) Conservation of energy

(I) the steps taken or impact on conservation of energy

Company's operation does not consume significant amount of energy. Latest technology required for better products applications and better quality have been adopted by the company.

(ii) the steps taken by the company for utilizing alternate sources of energy.

(iii) in case of imported technology (important during the last three years reckoned from the beginning of the financial year)

Nil

(a) the details of technology imported

(b) the year of import;

(c) whether the technology been fully absorbed

(d) if not fully absorbed areas where absorption has not taken place and the reasons thereof

(iv) the expenduture incurred on Research and Development

Nil

18. PROTECTION FUND :

Your Company did not have any funds lying unpaid or unclaimed for a period of sevenyears. Therefore there were no funds which were required to be transferred to InvestorEducation and Protection Fund (IEPF)

19. FOREIGN EXCHANGE EARNING AND OUT GO

There was no earning of Foreign Exchange during the year under review. There was no outgo in Foreign Exchange during the year under review.

20. OUTLOOK FOR THE FUTURE AND EXPANSION

Your Directors would like to inform you that the work on the setting up of new flourmill in AgartalaM/s Lalit Flour Mills is being held in abeyance till the completion ofBroad Gauge in Agartala.

21. DIRECTORS' RESPONSIBILITY STATEMENT

In accordance with the provisions of Section 134(3)(c) and Section 134(5) of theCompanies Act 2013 your Directors state that:

a) in the preparation of the annual accounts for the year ended 31st March2016 the applicable accounting standards have been followed and there is no materialdeparture in this regard;

b) the Directors have selected such accounting policies and applied them consistentlyand judgements and estimates that are reasonable and prudent so as to give a true and fairview of the state of the affairs of the Company as at 31st March 2016 and ofthe profit of the Company for the year ended on that date;

c) the Directors have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of this Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;

d) the Directors have prepared the annual accounts on a going concern basis;

e) the Directors have laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and are operatingeffectively;

f) the Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems are adequate and operating effectively.

22. CORPORATE GOVERNANCE

The Company has taken proactive steps to ensure that the conditions of CorporateGovernance as stipulated in SEBI (LODR) Regulations.. A separate report on CorporateGovernance together with Auditors' Certificate on its compliance are included inthe Annual Report.

23. ACKNOWLEDGEMENT

Your Company is grateful for the co-operation and continued support extended by theDepartment of Food & Civil Supplies Food Corporation of India and other departmentsin Central Government Government of Assam Banks Insurance Companies Customers &Suppliers. The Board of Directors greatly appreciates the dedicated service rendered byall the employees of your Company. The future prospects of the Company are bright and itwould be the Company's endeavour to merit the confidence of all share holders.